BP And Anadarko Fight Deepwater CWA Claims In 5th Circuit Appeal

BP PLC and Anadarko Petroleum Corp. are trying to get the Fifth Circuit Court of Appeals to rule that they can’t be held liable for Clean Water Act (CWA) violations arising out of the Deepwater Horizon disaster. The companies blasted the U.S. Department of Justice in what they called an “expansive” reading of the statute. BP and Anadarko, which co-owned the Macondo well, claim they can’t be held liable for civil penalties under the CWA because the last equipment the oil touched as it flowed into the Gulf of Mexico was a blowout preventer owned by Transocean Ltd., the well’s contractor.

The two companies are appealing a February 2012 ruling by Judge Barbier, which found both liable. He adopted the single-source rule providing that CWA liability only attaches to the parties responsible for the location of the single discharge point. In his ruling, Judge Barbier held that BP and Anadarko were responsible for the oil spill because the relevant source of oil was the Macondo well, rather than the floating rig to which the well was connected to. BP claims that CWA liability turns on the location of the relevant discharge.

BP wants the Fifth Circuit to hold that multiple sources can be liable under the CWA for the same spilled oil. They are asking the appeals court to adopt their preferred single-source rule. They claim that would absolve them of CWA liability if the appeals court were to find that the discharged oil came from the floating rig, not the underwater well. While that seems illogical, it’s their position.

Transocean, which has settled with the federal government, has filed a brief which pretty much supports the government’s position. The brief says that the CWA interpretation proffered by BP and Anadarko would unfairly shift all offshore spill liability to drilling contractors and upend the economics of the offshore industry.